Table of ContentsIntroductionInvestment OpportunitiesPotential Applications for New InvestmentsOrigin of the InvestmentInvestment in Non-Traditional TechnologiesKind of InvestmentAbout Nanomarkets
The recent report offered by NanoMarkets cannot be considered as a guide for strategic investors or venture capital (VC), but it is feasible to determine certain market requirements in the OLED encapsulation sector that may be of potential interest.
The factors that cause NanoMarkets to believe that there are some real opportunities for investment include the following:
- After several years of languishing, OLEDs have finally emerged as a real market, and the opportunities for growth are high, particularly for firms that can offer encapsulation technologies with concrete performance and cost benefits when compared to the cover glass strategies presently used.
- The largest OLED growth sectors are in larger-format panels, both in OLED TV displays and, to be more specific, in OLED lighting. Therefore, the total addressable area for OLED encapsulation will grow greatly as these markets grow, which will lead to higher volumes for materials suppliers.
- In the highest growth markets—OLED lighting and TVs —requirements for encapsulation barrier performance are greater than that found in the smaller displays on the market today. Consquently, the opportunities are greater for firms to differentiate themselves and obtain a market share based on encapsulation that ensures better lifetime performance.
Potential Applications for New Investments
Keeping in mind the above factors, NanoMarkets believes that there are some potential areas where new or additional investment can be justified:
- Multilayer, or single layer, laminates that actually enable economic manufacturing with the use of polymeric substrates and polymers without sacrificing barrier performance.
- Highly flexible OLEDs, which would require truly flexible encapsulation, are still far in the future, but there is the possibility of enhancing the capabilities of OLED devices by offering partially bendable or conformable encapsulation options. In case, partial flexibility is all that is actually needed, then there are probably already several dyad and similar technologies offered that just need a slight nudge to get them into the market.
- Flexible glass must not be ignored. The performance benefits of glass are truly awesome and overlooking it is out of question. And since glass manufacturing costs are closely linked to weight, thin flexible glass may be able to minimise costs even more that might be expected at first glance. As truly flexible OLEDs are still a dream and far from being commercialized, the partial, yet real, flexibility of thin, flexible glass may be suitable for high volume, large format, OLED manufacturing of OLED lightings and TVs.
Origin of the Investment
Nanomarkets believes that the investment will originate from within the glass industry, specifically from key players such as NEG, Corning, Asahi Glass and will still dominate cover glass technology enhancements by offering frit-sealed covers or air-gap free. The glass industry has professional expertise, competition is fierce and the major firms have comprehensive R&D programs aimed at new sectors such as OLEDs.
Investment in Non-Traditional Technologies
However, there may be several opportunities for productive outside investment in non-glass encapsulation. There are a number of factors that will positively impact investment in non-traditional technologies:
- There is a clear indication that the OLED markt will grow considerably. OLEDs in smartphones are taking off, led by Samsung; OLED TVs will be shortly commercially available widely and OLED lighting is set to grow to be the largest market of all.
- Investors will invest if sales are high, which is not possible at this stage, but they may be drawn to technologies that show great performance advantages with the promise of increased investment gains down the road. Non-glass encapsulation strategies based on low-cost, R2R-compatible barrier laminates can gain considerable market share in the mid- to long-term. The growth sectors for OLEDs in TV displays and in lighting will both rely on high volume manufacturing in order to realize economies of scale sufficient to bring costs down to levels that support truly widespread consumer adoption, and R2R production will be the right step in this direction.
- The photovoltaics industry is a potential growth sector presently in an upward growth trajectory, and which considerably expands the market for encapsulation. Investors can capitalize on this expanding market as way to use their specific technology across two industries—one which is "easier" i.e. photovoltaics and the other which is perhaps more of a stretch initially i.e. OLEDs.
Kind of Investment
NanoMarkets believes that additional or new VC investment is not likely at this stage as OLED industry has been long around to attract VC firms. The tim for high return/high risk investment has passed.
In contrast, investment in the form of takeovers by huge industrial firms, especially big consolidated firms in the display or lighting device or materials industries, is far more likely.
- Large and mid-size firms already in the lighting or display markets can more readily be pulled into strategic deals based on synergies that lead to higher cash flows than pure equity investors will realize.
- Additionally, NanoMarkets believes that it will continue to be important for encapsulation firms to be sufficiently linked into the OLED supply chain, and that it will be highly important for all existing and new encapsulation suppliers to partner closely with end-users.
- Since OLED manufacturers have acquired encapsulation firms with Samsung's de facto takeover of the Vitex Barix technology, this trend is expected to continue with other encapsulation firms.
NanoMarkets is a leading provider of market research and industry analysis of opportunities within advanced materials and emerging energy and electronics markets. Since the firm’s founding, NanoMarkets has published over one hundred comprehensive research reports on emerging technology markets. Topics covered have included OLED displays, lighting and materials, thin-film electronics, conductive inks, transparent conductors, renewable energy, printed electronics and other promising technologies. Our client roster is a who’s who of companies in specialty chemicals, materials, electronics applications and manufacturing.
This information has been sourced, reviewed and adapted from materials provided by NanoMarkets.
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